Established by:
WHAT IS A POOLED EMPLOYER PLAN?
Understanding the PEP
A Pooled Employer Plan (PEP) is a 401(k) retirement plan that allows multiple unrelated employers to participate together under a single plan rather than each company sponsoring and managing its own. Also, allowing each plan to be customized to their individual tailored needs.
PEPs were created to make high-quality retirement plans accessible to more employers — especially small and mid-sized businesses that have struggled to offer competitive 401(k) benefits due to cost, complexity, and legal risk.
Under a PEP, a third-party Pooled Plan Provider assumes the majority of the administrative and fiduciary responsibilities that would otherwise fall on you as the employer. That means there can be less burden on your HR team, reduced legal exposure, and a retirement benefit your employees may actually value.
Essentially: Instead of sponsoring your own plan and carrying the cost, complexity, and legal risk, you would choose to adopt the PEP and we handle the rest.
KEY FACTS
SECURE Act legislation
Available since:
January 1, 2021
Plan type:
Multiple employer defined contribution (401k)
Sponsored by:
A third-party Pooled Plan Provider (not the employer)
RIA / PPP:
Royal Fund Management, LLC
Recordkeeper:
Empower
TPA / 3(16):
Finway Group
Investment Mgr:
Bell Rock Capital — 3(38) Fiduciary
Why the Traditional 401(k) Falls Short for Many Employers
ERISA Fiduciary Liability
Employers who sponsor their own plan are personally responsible for ensuring investments are appropriate, fees are reasonable, and the plan is compliant. Mistakes can result in expensive lawsuits.
Limited Investment Options
Without scale, smaller plans often can't access institutional investment share classes or the lowest-cost fund options available to larger plans. Sometimes the problem is they simply don’t know what investment options are available without having a designated 3(38) fiduciary acting in the plans best interest.
Administrative Burden
Plan documentation, IRS Form 5500 filings, nondiscrimination testing, required notices, and compliance updates all require time and understanding most businesses don't have in-house.
Multiple Vendor Relationships
Managing a recordkeeper, custodian, investment advisor, TPA, auditor, and actuary separately creates administrative complexity and coordination risk.
High Costs
A traditional single-employer plan typically requires engaging a recordkeeper, custodian, investment advisor, trustee, and auditor — engagements that can have hidden cost with a higher administration.
The PEP Solves All of This
A PEP can shift fiduciary responsibility, consolidates vendors, reduces costs through economies of scale, and gives your employees access to potentially better performance and connectivity which can reduce administrative burden.
Advantages of a Pooled Employer Plan
01
CORPORATE RETIREMENT
Lower Costs Through Economies of Scale
Because multiple employers share the plan infrastructure, administrative and recordkeeping costs are spread across a much larger asset base. This commonly results in lower fees for both the employer and individual participants.
- Average weighted net investment expense of just 0.24%
- Administration for each individual plan is priced based on the average participant account balance
- Lower fees mean more of your employees' money can stay in their accounts
02
CORPORATE RETIREMENT
Lower Costs Through Economies of Scale
Because multiple employers share the plan infrastructure, administrative and recordkeeping costs are spread across a much larger asset base. This commonly results in lower fees for both the employer and individual participants.
- Average weighted net investment expense of just 0.24%
- Administration for each individual plan is priced based on the average participant account balance
- Lower fees mean more of your employees' money can stay in their accounts
03
CORPORATE RETIREMENT
Simplified Plan Administration
The day-to-day administration of the plan — including plan documentation, required government filings, nondiscrimination testing, and participant notices — is handled by our TPA partner Finway Group. Your team is no longer responsible for a majority of plan tasks.
- IRS Form 5500 filings, plan audits, and compliance testing all handled
- Participant notices delivered automatically through Empower
- Finway Group: largest 3(16) non-producing premier partner
04
CORPORATE RETIREMENT
Active, Professional Investment Management
Through 401(k) Maneuver, each employee's account is individually managed by a licensed investment fiduciary based on their risk tolerance in one of our three asset allocation models and current market conditions. This is not a robo-advisor or a set-it-and-forget-it target date fund.
- Real people making personalized decisions every quarter — not algorithms
- Participants enroll at 401kManeuver.com and we handle things from there
05
CORPORATE RETIREMENT
Institutional-Quality Investment Lineup
The PEP's investment lineup is managed by Jacqueline Reeves of Bryn Mawr, a Board-Certified Fiduciary with over 20 years of experience. The fund lineup is benchmarked and reviewed at least quarterly.
- 3(38) Investment Manager assumes fiduciary responsibility for fund selection
- Diversified lineup across equity, fixed income, and specialty categories
- Benchmarked and reviewed at least quarterly — no set-it-and-forget-it
06
CORPORATE RETIREMENT
Streamlined Vendor Relationships
A traditional plan typically requires managing multiple separate vendor relationships. Under the PEP, services including recordkeeping, plan administration, investment management, and custody are coordinated.
- Recordkeeping: Empower — nation's second-largest retirement services company
- Plan administration: Finway Group — TPA and a full 3(16) plan administrator
- One point of contact: John Link Companies coordinates the entire relationship
INDIVIDUAL PARTICIPANT ACCOUNT MANAGEMENT — POWERED BY ROYAL FUND MANAGEMENT
401(k) Maneuver is a business name of Royal Fund Management, built to provide individual, active management of each participant's 401(k) account. Most participants never change their initial investment allocation - usually a Target Date Fund - and simply hope for the best. 401(k) Maneuver can change that. Real people make individualized changes every quarter, based on each participant's risk tolerance, actual market events, and the investment options available in your plan. Participants enroll at 401kManeuver.com and link their account and we take care of the rest.
FAQ
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Is a PEP right for my business?
A PEP can be a strong option for employers who want to offer a competitive retirement benefit without the complexity of sponsoring their own plan. If you are not currently offering any retirement plan, a PEP could be one of the most cost-effective ways to start. One of the best ways to find out if it is right for you is a conversation — there is no cost and no obligation.
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What does the setup process look like?
The onboarding process typically takes 60 to 90 days, depending on the complexity of your current plan. John Link coordinates the entire process on your behalf. It begins with a kickoff call between you, Finway Group, and Royal Fund Management, followed by new plan document preparation, employee census data collection, payroll integration training, Empower platform setup, and an enrollment meeting for your employees. We believe in doing it right the first time — and we commit to stay in close contact throughout, so no one is in the dark.
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Can we move our existing 401(k) into the PEP?
Yes. If your business already sponsors a 401(k) plan, we can work through the process of transitioning to the PEP. This includes contacting your current provider, setting blackout dates for the asset transfer, and preparing the required notices for your employees. Finway Group manages this process as part of their 3(16) plan administration responsibilities. Our goal is to make the transition as smooth as possible — with minimal disruption to your employees' accounts and your payroll workflow.
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What does it cost my business to participate in the PEP?
We aim to keep the cost structure straightforward. There is no plan-level fee billed to the employer. All plans are priced based on the average participant account balance for recordkeeping and full 3(16) Third Party Administration. Include for all plan participants is an Participants who elect active management through 401(k) Maneuver pay a quarterly fee of 0.15% of their account balance. Compared to the total cost of a traditional single-employer plan our PEP typically represents a significant cost reduction.
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What happens to employees who already have 401(k) balances?
Existing account balances are transferred as part of the plan conversion process. Finway Group coordinates the asset transfer with your current provider, manages the blackout period, and review that all participants receive the required notices. Once the transition is complete, each participant's account is enrolled in the Empower platform and becomes eligible for active management through 401(k) Maneuver. The process is designed to be seamless — participants do not lose their savings history and can pick up right where they left off.
Ready to offer a 401(k)?
Let's start with a conversation.
We'll walk you through how the plan works, what it would cost, and whether it is a better fit than what you currently have. No obligation. No jargon.
